Required information [The following information applies to the questions displayed below] Bergo Bay's accounting system generated the following account balances on December 31. The company's manager knows something is wrong with this list of balances because it does not show any balance for Work in Process Inventory. and the accrued factory payroll (Factory Wages Payable) has not been recorded. Cash Accounts receivable Raw materials inventory Work in process inventory Finished goods inventory Prepaid rent Accounts payable Notes payable Common stock Retained earnings (prior year) Sales Cost of goods sold Factory overhead General and administrative expenses Totals Debit $ 170,000 75,000 80,000 0 15,000 3,000 218,000 115,000 60,000 $ 736,000 Credit $ 17,000 25,000 50,000 271,000 375,000 $ 736,000 These six documents must be processed to bring the accounting records up to date. $ 10,200 direct materials to Job 402 Materials requisition 10: Materials requisition 11 Materials requisition 12: Labor tine ticket 52: Labor tine ticket 531 $ 18,600 direct materials to Job 404 $ 5,600 indirect materials $.36,000 direct labor to Job 402 $ 23,800 direct labor to Job 404 $8,200 indirect labor Labor time ticket 54: Jobs 402 and 404 are the only jobs in process at year-end. The predetermined overhead rate is 200% of direct labor cost 4. Prepare an income state ment for the year and a balance sheet as of December 31. Hint Retained earnings is $356,800 at the end of the current year. 5. Assume that the $5.600 on materials requisition 12 should have been direct materials charged to Job 404. Does this error result in overstatement or understatement of total assets?
Required information [The following information applies to the questions displayed below] Bergo Bay's accounting system generated the following account balances on December 31. The company's manager knows something is wrong with this list of balances because it does not show any balance for Work in Process Inventory. and the accrued factory payroll (Factory Wages Payable) has not been recorded. Cash Accounts receivable Raw materials inventory Work in process inventory Finished goods inventory Prepaid rent Accounts payable Notes payable Common stock Retained earnings (prior year) Sales Cost of goods sold Factory overhead General and administrative expenses Totals Debit $ 170,000 75,000 80,000 0 15,000 3,000 218,000 115,000 60,000 $ 736,000 Credit $ 17,000 25,000 50,000 271,000 375,000 $ 736,000 These six documents must be processed to bring the accounting records up to date. $ 10,200 direct materials to Job 402 Materials requisition 10: Materials requisition 11 Materials requisition 12: Labor tine ticket 52: Labor tine ticket 531 $ 18,600 direct materials to Job 404 $ 5,600 indirect materials $.36,000 direct labor to Job 402 $ 23,800 direct labor to Job 404 $8,200 indirect labor Labor time ticket 54: Jobs 402 and 404 are the only jobs in process at year-end. The predetermined overhead rate is 200% of direct labor cost 4. Prepare an income state ment for the year and a balance sheet as of December 31. Hint Retained earnings is $356,800 at the end of the current year. 5. Assume that the $5.600 on materials requisition 12 should have been direct materials charged to Job 404. Does this error result in overstatement or understatement of total assets?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Required information
[The following information applies to the questions displayed below]
Bergo Bay's accounting system generated the following account balances on December 31. The company's manager
knows something is wrong with this list of balances because it does not show any balance for Work in Process Inventory,
and the accrued factory payroll (Factory Wages Payable) has not been recorded.
Cash
Accounts receivable
Raw materials inventory
Work in process inventory
Finished goods inventory
Prepaid rent
Accounts payablet
Notes payable
Common stock
Retained earnings (prior year)
Sales
Cost of goods sold
Factory overhead
General and administrative expenses
Totals
Debit
$ 170,000
75,000
80,000
Materials requisition 10:
Materials requisition 11:
Materials requisition 121
0
15,000
3,000
218,000
115,000
60,000
$ 236,000
Credit
$ 17,000
25,000
50,000
271,000
375,000
$ 230,000
These six documents must be processed to bring the accounting records up to date.
$ 10.200 direct materials to Job 402
$ 18,600 direct materials to Job 404
Labor tine ticket 521
$5,000 indirect materials
$36,000 direct labor to Job 402
$ 23,800 direct labor to Job 404
$5,200 indirect labor
Labor tine ticket 531
Labor time ticket 54:
Jobs 402 and 404 are the only jobs in process at year-end. The predetermined overhead rate is 200% of direct labor cost.
4. Prepare an income statement for the year and a balance sheet as of December 31. Hint Retained earnings is $356.800 at the
end of the current year..
5. Assume that the $5,600 on materials requisition 12 should have been direct materials charged to Job 404. Does this error result
in overstatement or understatement of total assets?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fdd49fd8f-ab38-4a09-a754-31a8a54e3e0f%2F411c5e4c-7969-4140-b77c-59710a805068%2Fiv12xak_processed.jpeg&w=3840&q=75)
Transcribed Image Text:0
Required information
[The following information applies to the questions displayed below]
Bergo Bay's accounting system generated the following account balances on December 31. The company's manager
knows something is wrong with this list of balances because it does not show any balance for Work in Process Inventory,
and the accrued factory payroll (Factory Wages Payable) has not been recorded.
Cash
Accounts receivable
Raw materials inventory
Work in process inventory
Finished goods inventory
Prepaid rent
Accounts payablet
Notes payable
Common stock
Retained earnings (prior year)
Sales
Cost of goods sold
Factory overhead
General and administrative expenses
Totals
Debit
$ 170,000
75,000
80,000
Materials requisition 10:
Materials requisition 11:
Materials requisition 121
0
15,000
3,000
218,000
115,000
60,000
$ 236,000
Credit
$ 17,000
25,000
50,000
271,000
375,000
$ 230,000
These six documents must be processed to bring the accounting records up to date.
$ 10.200 direct materials to Job 402
$ 18,600 direct materials to Job 404
Labor tine ticket 521
$5,000 indirect materials
$36,000 direct labor to Job 402
$ 23,800 direct labor to Job 404
$5,200 indirect labor
Labor tine ticket 531
Labor time ticket 54:
Jobs 402 and 404 are the only jobs in process at year-end. The predetermined overhead rate is 200% of direct labor cost.
4. Prepare an income statement for the year and a balance sheet as of December 31. Hint Retained earnings is $356.800 at the
end of the current year..
5. Assume that the $5,600 on materials requisition 12 should have been direct materials charged to Job 404. Does this error result
in overstatement or understatement of total assets?
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